Unicredit was the worst hit in morning trade. Its cost of protection jumped 33.55 basis points to 205bp, a new record, according to data from Markit Group, while its stock dropped 5.2 per cent to €1.14. Other banks such as
Santander and
BBVA of Spain, which were also down in
the European stock market and were both about 10bp wider in the credit default swap market.
Credit was in worse shape generally, with the iTraxx Europe index of investment grade companies more than 5bp wider in morning trade at about 166bp, while the Crossover list of mostly junk-rated names was 17.6bp wider at 1110.1bp, not far off its record high of roughly 1120bp. This means it costs €1.1m annually to insure €10m worth of Crossover debt.